New York, NY – August 5, 2025 – American Eagle Outfitters Inc. (NYSE: AEO) experienced a remarkable 23% surge in its stock price on Monday, August 4, 2025, closing at $13.28 per share, after President Donald Trump publicly praised the company’s provocative advertising campaign featuring actress Sydney Sweeney. The campaign, titled “Sydney Sweeney Has Great Jeans,” has sparked widespread debate due to its wordplay on “jeans” and “genes,” with critics accusing it of promoting eugenics and white beauty standards, while supporters, including prominent conservative figures, have hailed it as a rejection of “woke” advertising. Trump’s endorsement, posted on his Truth Social platform, appears to have fueled a meme-driven rally, boosting investor confidence and driving significant market activity.

The Campaign and Its Controversy

Launched on July 23, 2025, the American Eagle campaign features Sydney Sweeney, known for her roles in Euphoriaand White Lotus, promoting the retailer’s denim collection. In one of the campaign’s viral videos, Sweeney, dressed in a denim jacket and jeans, narrates, “Genes are passed down from parents to offspring, often determining traits like hair color, personality, and even eye color. My jeans are blue.” The ad concludes with a narrator quipping, “Sydney Sweeney has great jeans,” leveraging a double entendre that has ignited polarized reactions.

Critics on social media platforms like X and TikTok have argued that the campaign’s focus on “genes” and Sweeney’s blonde hair and blue eyes evokes eugenics, a discredited pseudoscience associated with racial superiority. Shalini Shankar, an anthropology professor at Northwestern University, told CNN that the ad’s language aligns with “a white nationalist, MAGA-friendly identity,” suggesting that American Eagle is deliberately appealing to conservative audiences in a politically charged climate. Some online commentators have labeled the campaign as tone-deaf or overly sexualized, with hashtags like #NotMyGenes and #AEGate gaining traction on X.

In response, American Eagle issued a statement on Instagram on July 31, 2025, defending the campaign: “Sydney Sweeney Has Great Jeans is and always was about the jeans. Her jeans. Her story. We’ll continue to celebrate how everyone wears their AE jeans with confidence, their way. Great jeans look good on everyone.” Despite the backlash, the campaign’s viral nature has driven significant attention, with clips amassing over 30 million views across social media platforms.

Trump’s Endorsement and Market Impact

The stock surge began shortly after President Trump’s comments on August 4, 2025, when he was informed by reporters that Sweeney is reportedly registered as a Republican in Florida, a claim first reported by BuzzFeed on August 2, 2025. Trump initially remarked, “If Sydney Sweeney is a registered Republican, I think her ad is fantastic.” Later that day, he posted on Truth Social, “Sydney Sweeney, a registered Republican, has the ‘HOTTEST’ ad out there. It’s for American Eagle, and the jeans are ‘flying off the shelves.’ Go get ‘em Sydney!” He contrasted the campaign with what he called “woke” advertising by brands like Jaguar and BUD LIGHT, which he claimed led to significant market value losses.

Trump’s endorsement resonated with conservative supporters, including Vice President JD Vance and Senator Ted Cruz, who praised the ad as a pushback against progressive marketing trends. Vance, appearing on the Ruthless podcast on August 1, 2025, mocked critics, stating, “My political advice to the Democrats is, continue to tell everybody who thinks Sydney Sweeney is attractive is a Nazi.” The support from high-profile Republicans, coupled with Trump’s influence, appears to have galvanized retail investors and meme-stock traders, who have been active on platforms like WallStreetBets, further amplifying the stock’s rally.

According to Reuters and CNBC, American Eagle’s stock had initially risen 16% upon the campaign’s launch but faced a slump as criticism mounted. Monday’s 23% jump, which saw the stock hit a two-month high, reversed some of these losses, though the company’s shares remain down approximately 20.3% year-to-date. The rally reflects a broader trend of meme-driven market activity, with traders capitalizing on the campaign’s polarizing attention to drive short-term gains.

Financial Context and Challenges

American Eagle has faced significant financial challenges in 2025. In May, the retailer reported a first-quarter net revenue of $1.1 billion, down 5% from the previous year, with comparable sales declining 3%. The company withdrew its full-year guidance and announced a $75-million write-off of spring and summer merchandise due to sluggish sales and market difficulties. The Sweeney campaign was part of a broader strategy to reverse this downward trajectory, with the retailer banking on viral marketing to boost brand relevance, particularly among Gen Z consumers.

Jennifer Foyle, American Eagle’s president and executive creative director, described the campaign as a “winning combo of ease, attitude, and a little mischief,” emphasizing Sweeney’s appeal. The campaign also includes the “Sydney Jean,” a denim product featuring a butterfly motif to support domestic violence awareness, with 100% of proceeds going to a crisis hotline. However, the philanthropy aspect has been overshadowed by the controversy surrounding the ad’s messaging.

Broader Implications

The stock surge highlights the volatile intersection of politics, culture, and markets. Rich Smith, a stock market analyst at Motley Fool, noted that Trump’s endorsement could be a “double-edged sword,” potentially alienating consumers who view the campaign as problematic. Some X users have suggested that Trump’s comments are a distraction from other issues, such as the Jeffrey Epstein case, with one post stating, “Donald Trump is posting about Sydney Sweeney because he doesn’t want to talk about the fact that he’s in the Epstein files.”

The campaign’s success in driving stock gains underscores the power of provocative marketing in a polarized climate. While American Eagle insists the ad is about denim, its alignment with conservative figures and the meme-stock frenzy has positioned it as a cultural lightning rod. It remains unclear whether the campaign will translate to sustained sales growth, with the company projecting a 5% revenue decline for the current quarter.

Looking Ahead

As American Eagle navigates the fallout and benefits of the Sweeney campaign, the retailer faces the challenge of balancing brand relevance with inclusivity. The stock’s volatility reflects broader market dynamics, where social media buzz and political endorsements can drive significant, albeit temporary, gains. Sweeney herself has not publicly addressed the controversy, and American Eagle has not responded to requests for comment on the stock surge or Trump’s endorsement.

The episode serves as a case study in the risks and rewards of edgy marketing, with American Eagle’s stock surge demonstrating the influence of high-profile endorsements in an era of meme-driven investing. As the debate over the campaign continues, investors and consumers alike will be watching to see whether the “Sydney Sweeney Has Great Jeans” controversy translates into long-term gains or further backlash for the retailer.

Sources: Reuters, CNBC, Forbes, The Washington Post, Bloomberg, The New York Times, Business Insider, The Independent, Instagram (American Eagle), X posts